Cognizant Churns it’s Workforce as Covid19 is Crashing Hard on the Economy

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Once again, Cognizant layoffs employees in India. The New Jersey-based IT servicing and consulting firm Cognizant (NASDAQ:CTSH) is levelling up their employee’s attrition rate due to the aftermath of Covid19 crisis.

But the spokesperson of American multinational company said that the recent layoff at Cognizant is a part of the usual performance-based management measure taken by all IT firms in the industry for every fiscal year. The sources also added that the layoff has mainly affected those who were on the bench for more than 35 days, and their inability to attain a project within the short period led to the termination.

Yes, the company is starting to churn off its workforce who were at the associate level, mid-senior level, and above, now, as per the sources. Last month the company was supposed to ask 400 executives who hold titles of directors, senior directors, associate vice-president (AVP), VP and SVP to leave the organization. It seems Moneycontrol had a chance to look at the email that addressed a terminated employee. It goes like this, 

 “… (We are) left with no other option other than to terminate your employment for the reasonable cause of failure… to secure work allocation and to be in the bench for a longer period with full salary.”

It is reported that the company asked the concerned employees to present in person to explain the reason for being on the bench for more than the allowed period of 35 days. Failing to appear, the company would deem the absence of the employee to be their ineptitude and will proceed with the process of scrutinising their employment.

Sources added that the underperformers were also asked to leave the organisation. However, the company’s severance package is quoted to be “unfair” by the sources.

Cognizant Layoff: The Protest Is On

All India Forum for IT/ITeS Employees, a Chennai based IT union had come forward to file a petition to the Chennai labor commission and submitted a letter on June 22 to the deputy commissioner of labor (Central), New Delhi. In the said letter of communication to the central authorities, the union has stated that the IT major is compelling employees to resign if they were incompetent to secure the project or their performance was rated to be poor. In this pandemic situation, the company is acting illegally and unethically by terminating numerous employees it added.

The numbers were not precise, though, but the IT union states there were about 18,000 employees under the bench, and 27,000 employees were rated as poor performers. But the company’s spokesperson states that performance-based assessment is a usual process across the IT industry. Moreover, the company asserts the third party allegations are not based on the facts, and the firm continues the hiring process at all levels throughout the nation and across the world.

The spokesperson also indicates the company’s upskilling and reskilling program that is gearing up employees at a scale in various latest digital technologies comprising cloud, data analytics, IoT, and digital engineering disciplines where the company is demonstrating industry growth above average.

The industry level experts warned that in the coming days there would be a lot of performance-based layoff measures to secure the company’s margin in the market.

Pareek Consulting, a tech consulting firm’s founder Pareek Jain states that this is due to the impact of Covid19, the clients are cutting the cost on the digital project, and hence the total business volume shrinks. So more people are left with fewer projects to work.

In earlier regular days, those employees on the bench will be like shadow performers and won’t be released from the projects. But now, the new normal is pushing the corporates towards the world of uncertainty in all business dealings. The near future would be hard for the existing employees as their performances scales would be gauged high he added.

It’s been a hard time ever since the novel corona strikes our ecosystem. One hardcore truth is that globally, the lockdown has impacted in tremendous economic stress and strain all across the business and the world’s economy. In the case of the IT industry, the workforce were asked to work from home to stabilise the market. But even then the corporates are left with no project as the whole world is stumbled to operate on a usual standard. 

This led to “bench the workforce.” So that workforce who are left with no project and kept on the bench was laid off by the companies.



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